Monday, October 11, 2010

About a month ago, I was shopping in my local supermarket and noticed a new product- Kellogg's Fruit Loops Doubles. Yes, they are Fruit Loops- complete with Toucan Sam on the packaging- but the "innovation" here is that the "Doubles" are two regular Fruit Loops bounded together to make 8's instead of "o"s. This reminded me of another cereal that embarked on another innovation. About 18 months ago, Shreddies introduced Diamond Shreddies. In the Shreddies case, the square Shreddies were "rotated" 24.5 degrees and branded as Diamond Shreddies. Both of these examples fit into a category called "irrelevant differentiation" and this is one of the more interesting (and under-explored) brand research streams. The seminal article is by Carpenter, Glazer and Nakamoto and I'll provide the citation in case you want to check it out.

The premise behind modern day branding is this: A brand does not achieve a high level of equity without developing a strong, favorable, and relevant point of uniqueness. Sometimes, the basis of the uniqueness may be meaningless in reality - but in the consumer's mind the irrelevant uniqueness can sometimes imply purpose. In the case of "Diamond" Shreddies, for example, Shreddies didn't change the Shreddies recipe, texture or taste. But "diamond" conjures up premiumness, sophistication, royalty, and superior images to the kid-shaped square Shreddies. If you actively think about this, everyone knows that a square Shreddie is the same as a diamond Shreddie, but in the subconcious part of the mind, a different part of the brain is lit up. The result, many consumers are drawn to the irrelevant attribute (diamond vs. square) - at least up to a point.

Let's look at a few classic examples of irrelevant attributes and then bloggify Carpenter experiments.

1. Corinthian leather in the Chysler Cordoba. (Sorry, but corinthian leather is a made up term) Check out this vintage ad.2. Folgers Flaked Crystal coffee. (Newsflash: flakes imply they disolve faster, but in reality this is not the case)3. Alberto Natural Silk Shampoo. (Awwwe. The presence of silk in no way impacts the performance of the shampoo)4. Mountain grown coffee. (Guess what? Almost all coffee is mountain grown) see Kellogg on Marketing.

Carpenter and pals were among the first to catch on to the irrelevant differentiation and they ran some experiments.

The basic set up went like this. Consumers were presented with two identical jackets. The jackets had the same color, shape, fit, stitching, style, brand etc but one jacket was "down filled" and the other jacket was "alpine down filled." But if consumers were advised in advance that alpine down filling was exactly the same as regular down filling- would they choose the alpine down filling? (The premise here is that "alpine down filling" implies more warmth and better quality than regular down filling.) What would happen if pricing was raised on the jacket with the "alpine down filling"? Let's look at a selection of manipulations that illustrate the researchers' findings.

SET-UP 1:Remember, consumers are advised in advance that the alpine down is 100% the same as the regular down. At the same price point, which jacket do consumers prefer?

Result: If you thought that consumers prefer the alpine down filled jacket, you're right. Ok, that makes sense. If alpine down filled ingredient implies great warmth, why not get it if there is no price penalty for it? But what happens if the price goes up a few dollars for the alpine down jacket?

SET-UP 2:Consumers are again advised in advanced that the alpine down is exactly the same as regular down. With a modest price premium, which jacket do the consumers prefer this time? Will they will flock (pardon the pun) to the regular down because they perceive the marketer to be taking advantage of them? Or does the irrelevant attribute effect still kick in?

Result: Consumers still prefer the implied warmth and benefits from the alpine down filled jacket. But what would happen if the price of the alpine-down filled jacket was cranked up a lot?

SET-UP 3:Consumers are again advised in advanced that the alpine down is the exactly the same as regular down. With a large price premium, which jacket would consumers prefer?

Result: This time, consumers selected the regular down filled jacket. The authors argue that when the price goes up significantly, the consumer starts paying more attention to the irrelevant differentiating factor and hone in on the fact that it is indeed irrelevant.

There are a bunch of conclusions that can be drawn from these experiments on everything from consumer manipulations to marketing strategies. I'm going to bring this discussion back to the cereals.

In the Shreddies example, my local retailers did not elevate the price of Diamond Shreddies relative to regular Shreddies. Most likely, this was the decision of the makers of Shreddies. The experiments suggest that both Shreddies and the retailers left "margin on the table". Some would argue that Diamond Shreddies positioning was actually making light of the irrelevance of the attribute (see ad here). I'll argue that the marketing campaign which makes light of the irrelevant attribute makes the brand more honest and likable- but the images of "diamonds being better, more precious" still would be conjured up in the consumers' minds. Of course, margin is not the only benefit that Shreddies could receive from such an initiative. The diamond campaign created some excitement around a stale brand in a stagnant growth category. Furthermore an extra facing in a store shelf enhances consumer exposure to the Shreddies brand and can displace a competitor which can only help sales. In short the campaign around the diamond differentiation helped to revitalize a brand but missed the essence of the price premium.

This takes us to Double Fruit Loops. On this one, I am stumped. I can't think of any reason why Kellogg's would push "doubles" as an irrelevant attribute. What could possibly be the advantage in the "dark side" of the consumers' minds related to the "8"s vs. the "Os"? "O"s are more fun for kids to play with - and from my breakfast experiment at home, I can't get more "Doubles" on my spoon than the originals. Because there is a lack of implied benefit to the 8s, Doubles probably won't be joining Corinthian leather, flaked coffee crystal and silk shampoo in the "winning" irrelevant differentiation category.

Wednesday, October 6, 2010

Montreal, October 6, 2010 - BrandMojo, a not-for-profit brand rating site that explores the most loved and hated brands, today announced Canada’s most loved and hated brands. The results are based on more than 68,000 ratings by more than 1,000 Canadians over a 9 month period.

As of October 6, 2010, below are some key Canadian brand rankings extrapolated from the site:

BrandMojo presents visitors with a logo of a randomly generated brand. The visitor then rates the brand from a scale of 1 (Hate) to 5 (Love). After rating the brand, the visitor can then see how other visitors rated the brand. The rater can skip the brand if he/she is not familiar with it. The BrandMojo site ranks more than 600 corporate brands and 40 non-profit brands through visitor ratings. Recently, sports teams, universities and celebrities have been added for rating.

The BrandMojo site is a not-for-profit site that explores the most loved and hated brands. It was created by Bob Mackalski as part of his doctoral dissertation research at the Desautels Faculty of Management at McGill University. The research is overseen by a team of professors who serve on his supervisory committee.